A saving account is a deposit account of an individual or a business entity that holds the principle security and earns a modest rate of interest over the principle amount after a decided time span or accounting period. Sometimes depending upon the type and principles involved in holding the saving account the person may not write checks for the saving account as the amount saved in the account is fixed that means it cannot be withdrawn. In certain types of saving accounts all the transaction are free without any fee however in some accounts after enjoying free transactions you have to give a specific fee in order to enjoy more transactions within your saving account. The funds saved in the savings accounts are considered to be the most liquid investments as they are out of demand accounts and cash. As compared to the saving account the current or checking account allows you to access account anywhere and anytime and you can withdraw your funds whenever required.
People operate saving account for the money they want to save for a long period of time and the money is not required for the daily expenses or for the daily biases. You can open a saving account by simply visiting a nearby bank along with proper identifications and required documents. However if a person is interested in a long term investment he or she is not advised to operate a saving account as the interest rate or markup is generally lower than that of investment certificates and treasury bills.
Other Related Accounting Articles: